Home Business Nigeria: NERC Upbeat About CBN, World Bank Intervention in Bridging Metering Gaps

Nigeria: NERC Upbeat About CBN, World Bank Intervention in Bridging Metering Gaps

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The Nigerian Electricity Regulatory Commission (NERC) has disclosed that two entities with significant financial commitments in Nigeria’s power sector – the Central Bank of Nigeria (CBN) and World Bank – could invest more money to close existing metering gaps in the sector.

NERC in a document it put out inviting stakeholders’ comments on a plan to close the metering gaps of electricity distribution companies (Discos) in the sector, explained that the proposal would be built around the current Meter Asset Provider (MAP) scheme and planned National Mass Metering Programme (NMMP).

According to the commission within a three-phase schedule, the CBN could fund Discos’ deployment of five million meters while the World Bank funds the deployment of any balance in the gap.

NERC noted that metering of end-use electricity consumption in Nigeria would help the sector achieve financial stability and improve customers’ satisfaction.

It also stated that this would enhance Discos’ revenue recovery.

Besides providing a transparent and accurate measurement for energy consumed by customer, the NERC added that meters would ensure energy accounting and revenue protection for the Discos while giving customers adequate information to control and manage their energy consumption.

“The cost of providing meters to customers should ordinarily be included in end-use electricity tariffs as an investment in infrastructure and hence part of the rate base for computation of revenue requirement.

“However, the prevailing absence of cost-reflective tariffs, a contributory factor to the impairment of Discos’ balance sheets, adversely impacts on the capacity of Discos to raise the necessary financing to support critical investments including but not limited to the metering of customers,” said the NERC which noted its various regulatory interventions on metering.

It stated that the MAP regulation which was announced in March 2018 to eliminate estimated billing practices, attract private investment in the provision of metering services and enhance revenue assurance in sector while promoting local meter manufacturing in Nigeria could not start off 2019.

According to NERC: “A total of 611,231 meters have been deployed as at 31st January, 2021 under the MAP initiative since its full operation despite the COVID-19 pandemic and other extraneous factors.

“The challenge of closing the metering gap in NESI still persists as more than half of the registered electricity customers remain unmetered.”